Can AI deliver what tax practitioners need?

Tax & Super Australia is constantly on the lookout for tools and aids that may be able to help our members operate their businesses more smoothly, improve that at-times elusive bottom-line, and help service their clients more efficiently and with less stress and headaches.

When we became aware of one service that on initial inspection seemed to offer an intriguing solution to technical research for practitioners, we thought it worth a look.

Ailira (artificially intelligent legal information research assistant) was launched by Adelaide-based tax law practice Cartland Law in March 2016. Tax lawyer and Ailira creator Adrian Cartland says the research platform “expedites tax practitioners’ ability to research and apply Australian tax law”, but does so on a much more in-depth level than other general-use search engines.

“In the past you might have tried a keyword search in Google or through the ATO website of, for example, ‘CGT potential beneficiary removal resettlement’ and browsed through the results found,” Cartland says. “You might have to spend considerable time skim reading through unhelpful articles that merely contain those words many times. Ailira returns only those documents that are contextually related to the question posed — hence precluding and eliminating any documents that are not pertinent to the question.”

Not just another GoogleBut far from being another version of a search engine, Ailira can continue to absorb data — as long as information is fed into it, it refines the databases it accesses and therefore improves the answers available. Since coming out of beta phase, Ailira has been fed with information from tax-law databases, legislation, rulings, ATO private rulings and more.

Ailira users ask the AI questions as they would another human being. From specific questions, the system process and displays three or four most likely correct answers. As practitioners will know, researching tax law to obtain and apply information relevant to a client’s situation is an everyday part of a tax professional’s day, and can be very time-consuming. Ailira’s ability to distil the answers found to most relevancy promises to reduce this.

Because of the specific nature of the data sources and the preciseness with which questions can be created, the results returned by Ailira are generally of greater value than the multitude of sometimes vaguely relevant answers returned by other search engines. But can AI deliver what tax practitioners need?

Natural language questionsThe AI platform is designed to answer tax related questions posed in natural language, so that questions can be asked just as you would of another tax practitioner. The more complex and specific the question is, the better the answer that can be returned.

Questions posed can be very specific, and Cartland says the platform is designed to answer questions like, “Can the beneficiary of a bare trust claim the main resident capital gains tax exemption?” and “Does a market value substitution rule apply to CGT event D1?”

However, just as “tell me all about CGT and trusts” is a difficult question for a human, so too it can be difficult for Ailira. “Instead, try and think of the exact question you want answered and ask that,” Cartland says. “Like ‘if I remove a potential beneficiary of a discretionary family trust, will that trigger a resettlement for the purposes of CGT?’ for example.”

Informed questions the keyThere are many databases the platform can search through, including legislation, court cases, private and public rulings, tax topics and various commentaries. The creator of Ailira says sometimes it is helpful to consider from which one of these sources the best answer can be derived, and that is relevant to the question posed. “When you receive an answer that does not quite fully address your question, try to explore the different ‘categories’. This will reduce the number of returned results and so focus on the information you are wishing to find.”

Obviously then, the knowledge to phrase questions in an informed way, which tax practitioners will possess, is important to get the most out of this AI platform. The practitioner’s expertise will also be required to review and interpret the resulting materials’ applications to specific cases.

Refining the practitioner’s placeThe many human labour hours required to retrieve relevant information to better service client needs may in the not-too-distant future shrink from the mammoth task that it can be today.

This was the finding of a recent study by McKinsey, that AI and other automation solutions will redefine, rather than replace, the tasks undertaken by humans in a lot of occupations — including within tax practices. These occupations will survive, the report argues, but AI can replace repetitive or routine tasks and free up resources for more valuable activities.

In a similar vein, a study by the Massachusetts Institute of Technology (MIT) posited that many of the skills that have made practitioners valuable, such as the ability to retain information and apply it in the right context, are in the cloud or programmed into databases to feed robots or other AI platforms. The study points to future employment that is not white or blue collar, but that is solidly found in non-routine tasks — as the latter will be taken care of by AI solutions such as Ailira.

Senior Tax Specialist at Tax & Super Australia, David Ebdon, says: “Ailira is a piece of software with a great deal of potential to save tax and legal practitioners time and effort.

“She has a comprehensive amount of rulings, decisions and cases at her disposal that I have found makes finding the right information less of a burden,” he says. “I look forward to hearing the feedback of our members and their comments on Ailira.”

Ailira will be featured in the ABC television program Lateline during the week starting August 7.

A free webinar, “Can AI deliver what tax practitioners need?”, is to be held on Wednesday August 16 for members, which will look at how Ailira works. See this page to book your place. Attendees will be offered one month’s free trial of Ailira (limited to members only) however we ask that trial users provide feedback to Tax & Super Australia via a survey, which will be emailed to each member during the trial period.